SMI: Industry gobsmacked by 14.3% decline in August

The industry has expressed shock at the latest Standard Media Index (SMI) figures for August, which have shown drops in bookings across all media except cinema and an overall drop of $94.5 million.

The SMI numbers, which measure media booked through agencies, indicated a 14.3% decline for August compared with last year.

Media heavyweights have blamed the fall largely on the Olympics, as advertisers keep clear of media during the event due to concerns of too much noise in the market. However, wider economic problems have also been cited.

The biggest decline was seen for magazines and newspapers, which fell 30% and 23.5% respectively.

Even digital, which is usually the strongest performer, fell 7.7%. Last month, the industry claimed a 5% fall in the digital market was an “anomaly”, but digital has fallen once again. (However, one media source said that the digital numbers for July were recalibrated after the SMI figures were released last month, and actually showed a 2% increase for July, and would probably show just a 1% decrease for August when the figures are recut.)

GroupM chairman John Steedman blamed the depressed figures on the Olympics and a wider environment of economic uncertainty.

“Some people held back during the Olympics, as they do because most of the attention is just on the sponsors,” Steedman said. “In past Olympics you see a similar scenario. I expect a comeback in September, but not much.”

Aegis Pacific chairman Harold Mitchell told AdNews the level of decline for August was a “surprise”.

“We've felt for some time that advertising would follow consumer confidence, which is at its lowest in years,” Mitchell said. “We knew advertising would soften but for it to soften this much is a surprise. Underlying all of this is the fact that Australia is in a good place compared to the rest of the world. This correction will only be temporary.”

Only cinema saw an increase in August, jumping 56.1%.

Val Morgan chief executive Damian Keogh said: “I've felt that cinema has been under invested in for a while in this market. We've been repositioning cinema and we're seeing rewards, and I feel we have a lot of room for growth.”

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